Not every transaction needs a bill of sale. Let’s take a look at common uses of a bill of sale and when it’s better not to use a bill of sale.

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Common Uses for a Bill of Sale

Selling a used car is a common reason that many people use a bill of sale. Other examples include the sale of boats, electronic equipment, guns, animals and furniture. If you sell goods frequently or in large quantities, a bill of sale form saves time.

Why You Need a Bill of Sale

When you are selling a valuable item that also requires registration, a bill of sale helps to prove your ownership. An automobile, motorcycle, branded cattle, and rifles are a few examples of items that require ownership papers.

Important reasons that you need a bill of sale are:
  • to document the transaction of valuable goods
  • to make sure everyone is clear on the terms
  • to bind both parties to the agreement
  • to create a record of the value of the property for taxes, insurance, etc.

Gifts and the Bill of Sale

Generally speaking, you do not need a bill of sale for gifts. People give and receive gifts all the time, and no paperwork is needed.


It may be legally required that you register the gift, for example, in the case of a vehicle or gun. To register a vehicle, many states require a bill of sale along with the title as proof of ownership. In this case, you would follow the instructions from your DMV or state regulating body. In New York, for example, the buyer and seller should fill out a bill of sale and indicate that the item was transferred as a gift.

When Not to Use a Bill of Sale

Low Value Items

A bill of sale is usually not necessary when selling certain items of low value. For example, low priced items sold at a garage sale, such as clothing, kitchen utensils and books, do not typically require a bill of sale. In these cases, you might write up a simple receipt if a buyer asks for it.

Real Estate or Company Purchase

You also would not use a bill of sale when selling real estate or a company. These deals are more involved and require detailed contracts.


Services are another category of purchases requiring contracts and not a bill of sale. A service agreement is typically more complex and requires documenting the scope of the work, service timeframes, compensation agreements, and responsibilities of the client and vendor. If you are a mechanic, for example, you would draw up a service contract when performing repairs. If you have fixed up your own car and plan to sell it as-is or with a limited warranty, you would use a bill of sale.   
Professionally developed bill of sale forms can help you to include all necessary details, such as names and contact information, a full item description and price, payment method, warranty details, the transaction date and signatures. Start your bill of sale form online and save time. 
Additional bill of sale resources: 

Get started Start Your Bill of Sale Answer a few questions. We'll take care of the rest.

Get started Start Your Bill of Sale Answer a few questions. We'll take care of the rest.